Joseph's Employer Pays 70% of the Premiums for a Disability

question 59

Multiple Choice

Joseph's employer pays 70% of the premiums for a disability insurance policy and Joseph pays for the other 30%.The policy pays Joseph 60% of his normal salary in the event he is injured and cannot return to work for an extended period.Joseph was injured in an accident and was unable to work for several months.During the current year, Joseph collected $75,000 under his disability policy.How much does Joseph include in his gross income?

• A)$0
• B)$22,500
• C)$52,500
• D)$75,000

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Definitions:

Compulsory Arbitration Agreements

Contracts where parties agree in advance to resolve future disputes through arbitration rather than litigation, often as a condition of employment.

Fairness

The quality of making judgments that are free from discrimination, honesty, and equity in interpersonal and societal dealings.

Waive Rights

The act of voluntarily relinquishing or giving up a known right or privilege.

Past Practice

is an established custom or way of doing things that, over time, has been accepted and expected by both employers and employees within an organization.